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Data centre energy consumption may double by 2026, finds report

Written by Fri 12 Apr 2024

A recent report from the International Energy Agency (IEA) has found data centre energy consumption could double by 2026, attributed to the increase in the adoption of artificial intelligence (AI) and cryptocurrency.

Global electricity consumption in 2023 slowed year-over-year, with a 2.2% change in demand compared to 2.4% in 2022. Despite electricity demand growing by 6% in China in 2023, it was offset by substantial declines in economies that were hit hard by the economic recession, including the US and Europe.

However, all of these trends are set to change this year, and through 2026, as electricity demand is predicted to increase by 3.4% or more year-over-year. Approximately 85% of the additional demand for electricity through 2026 is expected to come from China, India, and Southeast Asia.

This forecast is supported by a positive economic outlook which will drive demand for electricity across established and emerging economies, with even higher growth concentrated in data centres.

Data centre energy consumption is already significant, totalling an estimated 460 terawatt hours (TWh) in 2022. However, the IEA predicted total demand could pass 1,000 TWh in 2026. This means that global data centre usage would be the equivalent of the total energy consumption for the entire country of Japan.

The IEA said that in the data centre, electrical consumption comes mainly from computing (40%) and cooling (40%). The remaining 20% is attributed to associated IT equipment usage. Depending on the pace of adoption, the report predicts that AI and cryptocurrency will drive data centre energy consumption to 620-1050 TWh in data centres in 2026, almost doubling from 2022 numbers.

IEA said the average electricity demand of a typical Google search is 0.3 Wh, compared to the average electricity demand of a ChatGPT request (2.9 Wh). The more Google incorporates AI into its 9 billion daily searches, the more electrical demand will increase. As other businesses incorporate AI processes and applications, demand will increase accordingly.

Market trends, including the fast incorporation of AI into software programming across sectors, increase the overall electricity demand of data centres. Fully implementing AI in search tools like Google could increase their electricity demand tenfold.

When comparing the average electricity demand of a typical Google search (0.3 Wh of electricity) to OpenAI’s ChatGPT (2.9 Wh per request), and considering 9 billion searches daily, this would require almost 10 TWh of additional electricity in a year.

IEA Recommends Regulation and Tech Improvements

Increased demand for electricity will have some repercussions across the global economy. First, the IEA recommended that governments focus on updated regulations and businesses focus on technological improvements, which ‘will be crucial to moderate the surge in energy consumption from data centres’.

This includes regulations like the revised Energy Efficiency Directive in the EU and the Energy Act of 2020 in the US which use transparency and accountability to promote better efficiency across the industry.

Advances in technology can also help improve efficiency to meet increased demand. For example, the adoption of high-efficiency cooling systems can reduce data centre demand by 10%; while Google reports that using DeepMind AI helped reduce demand by 40%.

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Written by Fri 12 Apr 2024

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